World Agricultural Supply and Demand Estimates

NOTE: Russia’s recent military action in Ukraine significantly increased the uncertainty of agricultural supply and demand conditions in the region and globally. The April WASDE represents an ongoing assessment of the short-term impacts as a result of this action.

The outlook for 2021/22 U.S. wheat this month is for stable supplies, lower domestic use, reduced exports, and higher ending stocks. Annual feed and residual use is lowered 10 million bushels to 100 million. The NASS Grain Stocks report, issued March 31, implied less feed and residual disappearance for the third quarter that was partially offset by an upward revision to this category in the second quarter. Exports are lowered 15 million bushels to 785 million as the U.S. remains uncompetitive to most markets and exports would be the lowest since 2015/16. Projected 2021/22 ending stocks are raised 25 million bushels to 678 million but are still 20 percent lower than last year. The projected season-average farm price (SAFP) is raised $0.10 per bushel to $7.60 on NASS prices reported to date and expectations for cash and futures prices for the remainder of 2021/22. This would be the highest SAFP since 2012/13.

The global wheat outlook for 2021/22 is for slightly higher supplies, increased consumption, lower trade, and reduced ending stocks. Supplies are increased by 0.7 million tons to 1,069.5 million on a combination of higher beginning stocks for Pakistan, Brazil, and Saudi Arabia and higher production for Pakistan and Argentina more than offsetting lower EU production.

Projected 2021/22 world consumption is raised 3.8 million tons to 791.1 million primarily on higher food, seed, and industrial (FSI) use for India. Based on greater offtake from government stocks to food distribution programs, India’s FSI is raised 4.4 million tons to a record 100.9 million. Projected 2021/22 global trade is lowered 3.0 million tons to 200.1 million as lower exports by the EU, Ukraine, the United States, and Kazakhstan are not completely offset by higher exports by Russia, Brazil, and Argentina. EU exports are reduced 3.5 million tons to 34.0 million on a lower-than-expected pace. Russia’s exports are raised 1.0 million tons to 33.0 million as it continues to export at competitive prices. Ukraine’s exports are lowered 1.0 million tons to 19.0 million as its Black Sea ports remain closed since the invasion by Russia in February. The majority of Ukraine’s exports have already been shipped with limited additional amounts expected for the remainder of 2021/22. Projected 2021/22 world ending stocks are lowered 3.1 million tons to 278.4 million with India accounting for most of the reduction that is only partially offset by higher EU stocks. Global stocks are projected at a 5-year low.

This month’s 2021/22 U.S. corn outlook is for offsetting changes to feed and residual use and corn used for ethanol production, with unchanged ending stocks. Feed and residual use is lowered 25 million bushels to 5.625 billion based on indicated WASDE-623-2 disappearance during the December-February quarter. Corn used to produce ethanol is raised 25 million bushels based on the most recent data from the Grain Crushings and CoProducts Production report, and the pace of weekly ethanol production during March as indicated by Energy Information Administration data. With offsetting use changes, ending stocks are unchanged at 1.440 billion bushels. The season-average farm price is raised 15 cents to $5.80 per bushel based on observed prices to date.

Global coarse grain production for 2021/22 is forecast 2.7 million tons higher to 1,501.6 million. This month’s 2021/22 foreign coarse grain outlook is for higher production, reduced trade, and larger ending stocks relative to last month. Foreign corn production is forecast higher with increases for Brazil, Indonesia, Pakistan, and the EU. For Brazil, production is raised reflecting increased area; yield expectations are essentially unchanged this month as much of the second crop will enter the critical phase of development during April. Indonesia corn production is higher as greater area more than offsets a slight reduction to yield. Corn production is raised for the EU, mostly reflecting increases for Germany, Romania, and the Czech Republic. Foreign barley production is lower with reductions for the EU and Tunisia.

Major global trade changes include lower forecast corn exports for Ukraine, Serbia, and Paraguay, with increases for Brazil, Canada, and India. Corn imports are lowered for China, Chile, and Bangladesh, but raised for Iran. Foreign corn ending stocks are higher, mostly reflecting increases for Ukraine, Serbia, the EU, and Indonesia that are partly offset by a reduction for Canada. Global corn ending stocks, at 305.5 million tons, are up 4.5 million from last month.

This month’s supply and demand outlook for 2021/22 U.S. rice is unchanged from last month but there are offsetting by-class changes for domestic use and residual. Based on the NASS Rice Stocks report, long-grain domestic use is raised 2.0 million cwt to 115.0 million and medium- and short-grain is reduced 2.0 million cwt to 30.5 million. The season-average farm price for all rice is lowered $0.20 per cwt to $15.70 on lower-than-expected prices reported by NASS for February for long-grain and expectations regarding prices and marketings for the remainder of 2021/22.

The 2021/22 global outlook is for lower supplies, increased trade, fractionally higher use, and reduced ending stocks. Global production is decreased by 1.0 million tons to 513.0 million, primarily on a lower estimate for Indonesia. Indonesia’s 2021/22 rice production is lowered 1.0 million tons to 34.4 million, on lower area for its main-season rice crop that was mostly harvested in February and March. Global trade in 2021/22 is raised 1.1 million tons to 52.5 million, with increased exports for India, Burma, Pakistan, and Thailand. India’s rice exports for 2021/22 are increased 0.5 million tons to a record 21.0 million on a strong pace of exports to date. China’s imports are increased 0.6 million tons to 5.2 million in 2021/22 based mostly on a continued strong pace of broken rice imports, which are mostly expected for feed use. Total global use is raised 0.1 million tons million tons to 511.2 million, as increases for China and the Philippines offset a decrease for Indonesia. World ending stocks are projected 1.7 million tons lower to 188.8 million, primarily on decreases for Indonesia and India. Despite the reduction, ending stocks would still be a record high, led by China and India which would hold 60 and 22 percent of global ending stocks respectively.

U.S. soybean supply and use changes for 2021/22 include increased exports and seed use, and lower ending stocks. Soybean exports are raised 25 million bushels to 2.12 billion, partly offsetting lower exports from Brazil, Ukraine, and Russia. Seed use is raised in line with record soybean plantings indicated in the March 31 Prospective Plantings report. Soybean ending stocks are projected at 260 million bushels, down 25 million from last month. Soybean oil changes include increased exports and lower ending stocks. Despite relatively high soybean oil prices, export sales have been stronger than expected through March. A lower soybean meal export forecast is offset by slightly higher domestic disappearance.

The season-average soybean price forecast is unchanged this month at $13.25 per bushel. Soybean meal prices are also unchanged at $420 per short ton. The soybean oil price is projected at 70.0 cents per pound, up 2 cents.

The 2021/22 global soybean supply and demand forecasts include lower production, crush, trade, and ending stocks. Global soybean production is reduced 3.1 million tons to 350.7 million on lower crops for Brazil and Paraguay. Soybean crush is lowered for Paraguay on lower supplies and reduced for China on the current pace to date. China’s soybean imports are also lowered 3 million tons to 91 million. Lower soybean exports for Brazil, Paraguay, Russia, and Ukraine are partly offset by higher U.S. shipments. Global soybean stocks are lowered 0.4 million tons to 89.6 million mainly on lower U.S. and Argentine stocks.

Another notable oilseed change this month includes lower sunflower seed crush for Ukraine, leading to lower meal and oil supplies for major markets like India, China, the EU, and Turkey. Partly offsetting these declines are higher palm and rapeseed oil imports for China, higher soybean oil imports for India, higher soybean meal imports for Turkey, and higher soybean imports for the EU.

USDA projects that decreases in 2021/22 U.S. sugar supply combined with an increase in use lowers ending stocks to 1,566,978 short tons, raw value (STRV) for an ending stocks-to-use ratio of 12.53 percent.

U.S. sugar supply for 2021/22 is decreased 60,343 STRV as decreases in sugar production are only mildly offset by an increase in high-tier tariff imports. Beet sugar production is decreased by 50,670 STRV to 5,338,098. About half of the reduction is attributable to lower production expected out of Michigan due to increased beet pile shrink reported by processors this month and fewer sugarbeets imported from Canada for processing than originally expected. With production in the Red River Valley region expected to run unusually long into the first week of June, production is reduced marginally to reflect increased risk to sugarbeets stored in increasingly warmer conditions. Also, production in California is expected to be slightly lower than originally forecast. Beet campaigns in the Pacific Northwest and Great Plains are planned to be over by the date of this WASDE and their production estimates made in late March have been incorporated into projected beet sugar production. Florida sugar production is decreased 22,335 STRV to 1,937,235 based on lower sucrose recovery from processors’ continuing analyses of the effect of late January freezes on the crop. Texas sugar production is reduced by 2,000 STRV to 128,000 based on processor reporting. High-tier tariff imports are increased by 14,662 STRV on recorded entries of raw sugar in the first two months of 2022. Projected high-tier tariff imports of refined sugar are unchanged from last month.

U.S. sugar deliveries for human consumption are increased by 65,000 STRV to 12,365,000 based on strong to-date deliveries by beet processors and on higher-than-expected direct consumption imports though the end of February.

Sugar production for 2021/22 in Mexico is increased by 187,690 metric tons (MT) to 6,166,690. Analysis of production data through week 26 (March 26) of the campaign implies that sugarcane yield and sucrose recovery will likely be higher than forecast but area harvest is likely to be about 10,000 hectares lower. The new forecast for yield is 69.038 MT per hectare; recovery is 11.29 percent; and area harvested is 791,383 hectares. This projection is close to the third estimate recently released by CONADESUCA in Mexico. They estimate production at 6,174,813 MT. They project a higher area harvested than USDA, a lower yield, and about the same level of recovery. Sugar exports are projected to increase by the same amount as the production increase. Exports under license to the United States are unchanged from last month.

The 2022 forecast for total red meat and poultry production is lowered from last month, as reduced forecasts for pork and poultry offset a higher forecast for beef. The beef production forecast is raised from the previous month as higher expected first quarter placements support larger fed cattle slaughter and more non-fed cattle slaughter is expected. Pork production is lowered based on the Quarterly Hogs and Pigs report, released on March 30, which estimated the March 1 inventory and indicated producers’ intentions to reduce farrowings in March-May. Broiler production is reduced on lower expected slaughter in the first quarter. No changes are made to production in the outlying quarters. Turkey meat production is lowered as Highly Pathogenic Avian Influenza (HPAI) discoveries to date are resulting in tighter supplies of turkeys. Egg production is also lowered as HPAI detections to date have affected the laying flock.

For 2022, beef imports are forecast higher from last month based on recent trade data. Pork imports are raised while exports are reduced on tight supplies and strong domestic prices. The broiler export forecast is raised as import demand has been strong in the early part of the year. The turkey export forecast is reduced as HPAI discoveries are resulting in restrictions from areas affected by outbreaks.

Fed-cattle prices are unchanged from last month. Hog prices are raised on tighter supplies and continued strength in demand. Broiler prices are raised on current prices and continued strength in demand. Turkey and egg price forecasts are raised on current prices and expected tighter supplies.

The milk production forecast for 2022 is raised on higher dairy cow numbers. The fat basis import forecast is lowered on lower expected imports of cheese and butterfat products, while exports are raised on stronger cheese and butter shipments. On a skim-solids basis, the import forecast is raised as imports of milk proteins are projected to more than offset weaker projected cheese imports. Exports are raised on higher projected shipments for whey and skim milk powder.

Price forecasts for cheese and butter were raised from the previous month on tighter stocks and firm demand. Non-fat dry milk prices were raised fractionally while whey prices were lowered, as U.S. prices are expected to become competitive with international prices. With the higher cheese price more than offsetting a lower whey price, the Class III price is raised.

The Class IV price is raised on higher butter and nonfat dry milk. The 2022 all milk price forecast is increased to $25.80 per cwt.

The U.S. cotton 2021/22 supply and demand forecasts are unchanged from last month. The marketing year price received by upland cotton producers is projected at a record 91 cents per pound, up 1 cent, reflecting recent high prices. The February 2022 upland farm price reached a record 100 cents per pound.

Month-to-month changes in the global 2021/22 cotton estimates are also small, with higher production and lower consumption resulting in an 800,000-bale increase in ending stocks, to 83.4 million. Production is forecast 340,000 bales higher, with increases for Pakistan and Greece. A 500,000-bale decline in China’s expected consumption resulted in a similar decline in the global estimate, which now stands at 124.1 million. A 300,000-bale decline in both China’s and Pakistan’s import forecasts are only partly offset by a 150,000-bale increase for Turkey. World trade is projected about 450,000 bales lower this month, with exports projected lower for India, Brazil, and Malaysia.

Click here to read the full report by the USDA.

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